There is a chilling sense of deja vu with the Delta variant

We must avoid past mistakes as Covid cases rise in the UK, as a resurgence would be a disastrous outcome for Ireland’s public health and economic policy
Colm McCarthy

No durable economic recovery is likely until the virus has been suppressed, and exceptional monetary and budget measures will be in place until then.

The Government’s decisions to extend the PUP and other budget supports will be repeated if that effort falters, as will the European Central Bank’s (ECB) emergency purchases of the extra government debt which the supports entail.

At some unknown future date, when Europe is deemed to have the disease decisively under control, emergency policies will be withdrawn.

The European Commission will seek to reimpose budget discipline, having suspended the Stability and Growth Pact because of Covid, and the ECB will buy government bonds, keeping government borrowing costs low, so long as it must.

The pace at which this happens will be determined outside the control of the Irish Government, but there is an economic payoff to getting the disease under control early.

It will then be possible to relax controls safely and to withdraw supports gradually, containing the rise in the already heavy debt burden. The worst outcome would be to seek borrowing leeway without success when eurozone budgets are returning to normality and the ECB to conventional monetary policy.

A resurgence of the disease in Ireland, especially if continental countries do better, would be a poor result for public health, but also for economic policy, since the politicians’ holiday from balancing the books would end with the economy still weak.

At Thursday’s press conference the Nphet experts remained upbeat about the progress of disease containment. New infections have stabilised for several weeks, fatalities have fallen quickly and numbers in hospital with Covid continue to drop, credited to the vaccine roll-out and continued observance of guidelines. The picture in the UK appears not to concern them unduly as there have been few cases uncovered here of the Delta variant that first emerged in India.

Notwithstanding the higher vaccination rates achieved in the UK, Nphet’s British counterparts are not so sanguine. The infection rate in the UK has doubled in the last week and there were 8,125 new cases on Friday, the highest figure since February.

The more infectious Delta variant now dominates new infections in Britain and the R-number, the reproduction rate at which the disease spreads, has risen above 1.0. The best estimate is about 1.3, which means infection numbers will continue to rise. Meanwhile, there has been criticism of Boris Johnson’s delay in restraining travel from India.

The UK began the current round of de-restriction back in March and there is evidence that public adherence to advised behaviour has also slackened. Infections would be expected to rise under these influences.

Meanwhile, the vaccination programme has proceeded impressively, offsetting the other two factors until the Delta variant came along. It has given the virus the upper hand once again, and the speed of the rise in case incidence is unnerving.

Less than half the UK population has the full immunity which comes a couple of weeks after the second vaccine dose, and the policy of delaying the second dose may prove to have been a decent gamble that failed.

According to the most recent estimates, a single dose does not protect well against the Delta variant and it already accounts for 90pc of new UK infections. In Northern Ireland, the more transmissible Delta variant already accounts for one-quarter of those infected, according to health minister Robin Swann.

If Nphet’s figures are up to date, Ireland has avoided a rapid Delta build-up so far, but it is fair to ask whether this can be sustained.

Although vaccination has broken the link between infection and numbers in hospital, a rapid increase in cases will see more Covid admissions.

Symptoms lag infection, sampling lags symptoms and positive test results lag sampling. People needing hospital treatment today may have been infected a week ago. The extra patients may contain few of the most vulnerable, so may not translate into fatalities, but they will strain capacity in a system working through a backlog of non-Covid patients.

Hospitalisations in the UK are a small fraction of the horrific numbers which threatened NHS capacity in January, but they have begun to rise.

Epidemiologists in the UK have conceded a further sharp rise in the daily case count is probable and the government must decide tomorrow whether the full relaxation of public health measures, scheduled for June 21, will have to be deferred.

This is the view of the British Medical Association and some experts would go further and reverse some of the relaxations already in place.

Ireland has not escaped the negative impact of imported variants from the UK in the past and it remains to be seen, despite Nphet’s optimism, if the Delta variant is to be the first.

The Government will hope Nphet are right, but must also be preparing for a postponement of any further relaxations here. If the UK, with its superior vaccination roll-out, is facing at least a pause in the pace of reopening, the rest of Europe will shortly be considering travel restrictions with the UK in the hope of keeping Delta out.

It will be another five or six weeks before most European countries reach the immunity level which has proved inadequate against Delta in the UK.

Any pause to reopening in Ireland will prolong the need for emergency support to household incomes and to teetering business firms, implying a greater need for preserving policy options for the recovery phase whenever it comes. That means avoiding expenditure commitments extraneous to the Covid emergency and keeping some budget powder dry.

The World Health Organisation’s director for Europe, Hans Kluge, has echoed the concerns of the UK experts. “We have been here before,” he warned on Thursday. “Over the course of last summer, cases gradually rose in younger age groups and then moved into older age groups, contributing to a devastating resurgence. Let us not make that mistake again.”

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